Commercial property is all about money. While it needs more investments, it’s the lure of high returns that makes investors put in their money into commercial projects. Hence commercial builders need to be well-established to meet the demand of their clientele and deal with various external and government issues to meet deadlines. Astro strategist Hirav Shah looks at various problems that commercial builders have from a realistic view and provides timely and practical framework for them.
Commercial property = returns. At least, that’s the common perception. Usually, the builders of commercial property expect their properties to be sold within short periods of time as investors are lured by the rents that they can get. It’s a pure concept of ROI or return of investment, both for the builder and the investor.
Commercial builders function in two ways. They build a property to suit a commercial need, let’s say a hospital, and let it out to prospective investors. Or, they build or renovate a property as per the requirements of the investor. Either ways, there’s a working synergy between both parties and this leads to healthy development of business.
Commercial real estate includes offices, retail, industrial, multi-family, hotels and special purpose buildings. There are sub-categories under these broad categories. Commercial real estate is exclusively used for business-related purposes or to provide a workspace rather than a living space. In fact, even residential spaces built for business purposes fall under commercial realty. The basic idea of commercial real estate is to lease property to tenants to generate income.
The investors of this type of realty are usually on the lookout for properties that can lead to passive income and cost appreciation in the long run.
Unlike residential builders, commercial builders need to be more aware of the challenges that the industry faces. Let’s check out the concerns of commercial builders
1) Poor productivity
Lack of skilled labour is a real-time problem for many builders. Commercial builders face a lot of issues due to lack of labour when required. Also, even if they hire labour, it is important that the labour is well-trained. Since commercial properties are built to last, the investors look into each and every detail before putting in their hard-earned money. It’s not just labour, commercial construction requires entire teams of people to realise a project. Also, construction is considered a less desirable industry to get into as it is physically demanding, dirty and can be downright dangerous. Also, projects can be inconsistent and there is always the threat of a lull due to less incoming work or change of seasons or economic downturn.
2) Rising cost of materials
Another major problem for commercial builders is the rising cost of materials. A project may take some months or a couple of years to get completed, based on how big it is. During this time, material costs change or fluctuate, impacting the revenues of builders. Also, a commercial builder has to be very particular with the materials and fittings he uses, as their property is sold at a premium vis-a-vis residential properties. Human resources’ costs also need to be factored here, as good professionals and labour come at a cost.
3) Poor project performance
This is a direct consequence of not having a good team and well-trained team players. At the nascent stage, everything looks prim and proper. However, by the time the actual building or property comes up, things may not pan out as expected. This leads to unsold inventory and directly impacts estimated income.
4) Sustainability and efficiency
Green buildings are the latest development in the realty industry. The onus is more so on commercial complexes and buildings, which have a variety of products and technologies that can be explored while constructing. Of late, the norms are such that commercial properties have to abide by the ‘green’ rules. Added to that, governments these days have strict rules and guidelines in place. So, it’s important that the project managers have a clear understanding of concepts and guidelines at the same time. However, failure to adhere can mean a delay in projects, potential fines, civil action or even criminal prosecution and can eventually harm a firm’s reputation.
5) Government regulations
There is increasing pressure on commercial builders with regards to a variety of rules and regulations. From restrictive building codes and licensing requirements to permit requirements, environmental and safety laws, a commercial builder has to take care of n number of factors. Abiding by all these regulations can be costly and time consuming. Also, restrictions can come in the form of local governments, state governments or national governments.
6) Socio-economic and political conditions
Socio-political reasons can push a project’s timeline backwards now, more than ever. Projects or construction can be stalled due to community or political pressure. Also, of late, everyone from adjacent property owners, businesses, institutions, as well as civic organisations and community groups want a say in matters. It is important to know the various laws and procedures to deal with such pressures. Such issues can lead to unsold inventory and impact estimated revenues.
7) Safety and health concerns
On any given day, there are more fatal injuries in the construction industry, than in any industry. Workers are exposed to workplace safety hazards such as falls, trench or scaffold collapses, electrical shock and injuries tied to equipment use or repetitive or strenuous movements.
Added to human suffering, construction companies have to bear the costs of workplace accidents. While such payments are not astronomical in countries like India, in the West, an estimated $10 billion is doled out for such emergencies.
While accidents can happen and will happen, commercial builders must prioritize workplace safety protocols and take precautions for the sake of workers and business. It has been found that most workplace deaths or accidents can be avoided with proper training and implementation of safety measures.
8) Time equals money
Commercial properties have to work on tight schedules. Once a property is given for development or when a builder takes a property for development, it is understood that he finishes the project in a stipulated amount of time. Delays in timeline would mean losses to customers, clients or tenants. The builders need to have a comprehensive plan to complete the project with all due guidelines.
Also, construction means coming together of various factors. Obviously, these present a variety of problems and hurdles for commercial builders. Seasonal weather, remote sites with access issues, occupied work spaces, neighbouring properties, equipment breakdown or malfunction are potential challenges for the builder. So, a commercial builder must have the expertise and know-how to foresee such problems and have the solutions for these problems. Else, it leads to fluctuations in estimated revenues and unsold inventory.
9) Vaastu and feng shui problems
While this might sound like superstition, it is a practical problem that all builders face. The problem is more pertinent in commercial properties as buyers invest for good returns and bad vaastu or feng shui is considered to mar their revenues. Hence commercial builders must comply with such elements to ensure their own estimated income.
How will astro strategist Hirav Shah help resolve the problem?
Commercial buildings are of different varieties as mentioned above. From the process of inception to completion, commercial builders have to face a variety of problems. Sometimes this could lead to extended periods of construction or even pumping in lots of money to satisfy a customer or customers.
The bottom-line is that commercial builders have to update themselves with various laws and guidelines in terms of the building and ‘green’ laws. The top priority is to have a good team for project completion. Well-trained and experienced staff is an asset for commercial builders. In fact, that’s how their potential clients gauge their capacity and give projects.
While commercial realty looks and sounds more glamorous and enticing, in actual terms it is loads of planning and hard work. Astro strategist Hirav Shah is a time-tested pro in matters of real estate business. It is one of his core specialities and he has worked extensively with builders of various types of realty over the years.
He is a well-travelled man with clients in different parts of the world. His corporate sense has helped many clients to tackle tricky situations. And he is a pro in matters of business astrology.
Astro strategist Hirav Shah does not go deep into astrological texts nor he confuses his clients with astro talk. His is a practical approach, where the personal chart of a builder is assessed and a clear timeline for his projects is given.
This helps the client to save a lot of time, energy and efforts. Astro strategist Hirav Shah believes that timely guidance can resolve persistent problems and provide a perfect timeline for commercial builders. This helps the builders to have a clear-cut idea of estimated revenues, thus reducing their stress levels.
Hirav Shah blends Astrology can give sales timeline for Unsold inventory and estimated revenues for Commercial properties.